Affordable Homes partnership

A classic Fianna Fail stroke to make it look like they are tackling a problem whilst handing their builder pals a goose that lays golden eggs.

This is off the topic of architecture but this is a typical example of a misconceived policy motivated by shallow populism based on economic ignorance.

I have a problem with the basic idea of affordable housing. A house (or apartment, etc.) fullfils an obvious and basic human need (for shelter, warmth, privacy, etc.) but also represents an important asset class. I have no problem with government social spending being used to ensure that people of whatever means have access to a decent roof over their heads. I have a big problem with government social spending being to subsidise the acquisition of assets for a small and somewhat arbitrary section of the population.

Affordable housing is effectively a lottery where the prize currently seems to be set at around 100,000 euro for the small number of winners (because they get to acquire an asset for 100,000 less than market value). To compound the mistake, the authorities are forced (otherwise the basic unfairness of the idea is too apparent) to attach damaging restrictions on the owners for example to prevent them selling the property. What if the owner loses their job and gets offered another in a different town for example?

The main beneficiaries of this government largess will be builders and developers. There will be a few young middle class families to parade about as the people “who were given a leg up the property ladder” by this policy.

It’s a farce that the government listens to advice from the vitners’ associations when considering policies to combat the problems associated with alchohol abuse. It is also a farce that the government works with builders and developers to develop policies to deal with the “problem” of property prices.

I agree with ewanduffy that this whole thing is both a sop to the builders’ lobby and a superficial attempt to look as if the government is achieving something on the issue of affordable housing. Fianna Fail trying to have it both ways and treating people like idiots? I am shocked. Shocked, I tells ya.

Jimg, I am a recent purchaser of an affordable home with Fingal Co. Co.: I bought my home at a cost of 25% below market value, which was a saving of €50,000. If I sell my home within 10 years of purchasing, I have to give 25% of the profits to the council. This percentage reduces after 10 years until 20 years after purchasing it is zero. I wouldn’t consider this restriction to be so prohibitive as to prevent me from moving in a few years should circumstances change. Yes, affordable housing can be a lottery in many ways, although currently there are plenty of houses available through Fingal Co. Co., but I and my neighbours (many of whom do not fit into the ‘young, middle class families’ category) have found it to be the only way available to own our own homes. It has worked well for us.

I wonder what the stamp-duty implications on site purchase are?

No 1 – is this just going to move even more people out of city centres, especially Dublin – they very places we want more people to live?

And no 2 – considering the potential difficulties in comparing inner city State sites with the value of the proposed housing, is standard suburban sprawl housing going to be the type ‘swapped’ as it’s the easiest to value and easiest to plan for and quickest to build?

I think George Lee summed it up well on the news tonight – there is an obvious bottleneck in the local authority system of providing such housing, and rather than this being resolved it has simply been superceded with this new scheme.
I have grave doubts about the selling of state land at market value to developers; it seems the only way to keep things clean and transparent in this country is to deal in hard cash on the open market. And I don’t refer to corruption, rather we are simply totally inefficient in dealing with state monies. I can see ‘money down the drain scandal’ plastered accoss The Rag on Sunday in 6 months time over some site that was swapped for under its market value.

Why can’t the sites be sold to the highest bidder and the hard cash used to build these houses, in a planned fashion by local authorities. Either method, it still takes the same amount of time to clear the planning process.
I’d rather the money be earned in a direct fashion by the state for the state.

Drip Drip Drip is the only way to dispose of a portfolio of this size without affecting the urban land market and given the amount of leverage in the market this could be a bad decision. I have no doubt that all Commercial property agents would attempt to maximise the price attained by the state but releasing so much so fast would make it very difficult as there are a restricted number of buyers that are in a position to both buy and supply product. This announcement is one of two things:

1> It is a soundbite three years into a five year term that has thus far delivered little other than elimination of part v of the planning act or:

2> It is a politically motivated decision that has the potential to undermine land values significantly and result in both significant macro-ecomonic risk and a return to the construction inflation position of the late 1990’s and early 2000’s before there is a potential crash.

What really annoys me is that this measure if carried out will divert scarce industry resources away from the National Development Plan and into the very places that need the infrastructure in the first place.